How do I evaluate my resellers beyond revenue? ... Sales Performance

By Anna Sophie Gross Mar 5, 2018

All too often manufacturers fall into the trap of only rewarding and incentivizing their distributors, sellers and marketers for quantity of sales. This means they ignore other, really important signifiers that their sellers are doing a great job, and adding significant value to their brand.

This is the second part of a four part series about ways you can track, evaluate and reward your resellers on activities other than quantity of sales. Today we’ll be focusing on incentivizing and rewarding resellers based on their sales performance.

What we ask you to do, is to extend and expand in your mind what you think of as a good seller. Being good at selling your manufactured goods does not just mean flogging the highest quantity of goods you possible can.

Average Contract Value

One thing you can measure your resellers on is their average contract value, i.e. how much their contract with you is worth. ACV  measures the value of the contract over a 12-month period.

You can then rank and tier each of your resellers based on this metric: from ‘just registered’, to ‘silver’, ‘gold’, and ‘premium’. That adds a bit of healthy competition, and allows members to see where they stand in relation to one another.

Average Order Value

This is a metric which is often overlooked by manufacturers. Basically, it doesn’t just matter how much people are selling, it also matters what each of their sales is worth. If you have a contractor, distributor or VAR who tends to make really high value sales, you want to be tracking, recognising and rewarding that. It’s a no-brainer, right?

You can monitor average order value (AOV) on a centralised platform, and then keep your resellers informed about how they sit in relation to their peers. Again, this adds a healthy sprinkling of competition to drive better performance and higher value sales.

Pipeline

Another useful way of measuring the business prowess and value of your resellers is by keeping track of their entire pipeline. You can measure what percentage of their sales reach certain pipeline markers, from identification to qualification, to proposal, to negotiation stage.

You can then set markers. Let’s say you want your contractors to get 30% of their leads to qualification stage. You can set your program so that when they reach that target they earn points towards rewards, bonuses or untapped leads. You can do the same for every tier of the pipeline process.

This is really clever manufacturer behaviour because it means you’re keeping tabs and incentivizing positive behaviors at every stage of the deal process. You’re not just saying, “I want lots of closed deals”, you’re saying:

“Here’s how you break down a deal, and I recognise that not every deal will be successful but I want you to try at every single stage. You should be striving to take every identified lead up one rung, and here’s a realistic goal you can work to.”

It’s all about broadening your horizons when it comes to assessing and rewarding your resellers for their sales performance. I hope we’ve shown how the value each distributor, contractor, VAR and marketer has for your company is not just about the quantity of sales they make, but also about their average value order, and success at moving leads along the sales pipeline.

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